REG - CVC Advisers Limited Hargreaves Lansdown Nordic Cap XI Delta Abu Dhabi Inv. Auth. - Further Update on Bidco's Financing Arrangements

Hargreaves LansdownAnnouncement

28/01/2025 07:00

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RNS Number : 8678U  CVC Advisers Limited  28 January 2025

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

FOR IMMEDIATE RELEASE

28 January 2025

RECOMMENDED FINAL* CASH ACQUISITION

of

Hargreaves Lansdown plc ("HL")

by

Harp Bidco Limited ("Bidco")

(a newly formed company indirectly owned by CVC Private Equity Funds, Nordic
Capital XI Delta, SCSp (acting through its general partner, Nordic Capital XI
Delta GP SARL) and Platinum Ivy B 2018 RSC Limited)

 

FURTHER UPDATE ON BIDCO'S FINANCING ARRANGEMENTS

On 9 August 2024, the HL Independent Directors and the board of directors of
Bidco announced that they had reached agreement on the terms and conditions of
a recommended final(*) cash acquisition of the entire issued and to be issued
ordinary share capital of HL by Bidco (the "Acquisition"). The Acquisition is
to be implemented by means of a Court-sanctioned scheme of arrangement under
Part 26 of the Companies Act 2006 (the "Scheme"). The scheme document in
relation to the Scheme was published on 6 September 2024 (the "Scheme
Document").

On 14 October 2024, HL announced that the Scheme had been approved by the
requisite majority of Scheme Shareholders at the Court Meeting held on 14
October 2024 and the Special Resolution relating to the implementation of the
Scheme had been approved by the requisite majority of HL Shareholders at the
General Meeting also held on 14 October 2024.

Capitalised terms used but not defined in this announcement have the meanings
given to them in the Scheme Document.

Barclays Bank plc, HSBC Bank plc, Lloyds Bank Corporate Markets plc, Mizuho
Bank, Ltd. and MUFG Bank, Ltd., London Branch (collectively, the "Original RCF
Lenders") entered into a commitment letter dated 22 September 2024 (the
"Original RCF Commitment Letter") under which they agreed to provide to Harp
Finco Limited ("Finco") a multicurrency revolving facility which shall be
available to Finco after the completion of the Acquisition for, amongst other
purposes, the general corporate and working capital purposes of Finco and the
Bidco Group (the "RCF"). On 22 September 2024, Finco and the Original RCF
Lenders also entered into a fee letter (the "Original RCF Fee Letter") and the
Original RCF Lenders entered into a conditions precedent status letter (the
"Original RCF CP Status Letter").

On 20 December 2024, KDB Asia Limited and The Royal Bank of Scotland
International Limited, London Branch (collectively, the "December RCF Lenders"
and together with the Original RCF Lenders the "RCF Lenders") and the Original
RCF Lenders amended and restated the Original RCF Commitment Letter (such
amended and restated commitment letter, the "December RCF Commitment Letter")
in order to provide additional RCF commitments of £45 million to Finco.
Together with the December RCF Commitment Letter, the RCF Lenders amended and
restated the Original RCF Fee Letter (such amended and restated fee letter,
the "December RCF Fee Letter"), and amended and restated the Original RCF CP
Status Letter (such amended and restated CP status letter, the "December RCF
CP Status Letter").

Bidco announces that on 27 January 2025, the RCF Lenders amended and restated
the December RCF Commitment Letter (the further amended and restated
commitment letter, the "January RCF Commitment Letter") in order to provide
additional RCF commitments of £10 million to Finco. Bidco also announces
that, together with the January RCF Commitment Letter, the RCF Lenders amended
and restated the December RCF Fee Letter (such further amended and restated
fee letter, the "January RCF Fee Letter"), and amended and restated the
December RCF CP Status Letter (such further amended and restated CP status
letter, the "January RCF CP Status Letter").

The January RCF Commitment Letter, the January RCF Fee Letter and the January
RCF CP Status Letter supersede and replace the December RCF Commitment Letter,
the December RCF Fee Letter, the December RCF CP Status Letter, the Original
RCF Commitment Letter, the Original RCF Fee Letter and the Original RCF CP
Status Letter in full.

Copies of the January RCF Commitment Letter, January RCF Fee Letter and
January RCF CP Status Letter will be available, subject to certain
restrictions relating to persons in, or resident in, Restricted Jurisdictions,
on HL's website at www.hl.co.uk/investor-relations
(http://www.hl.co.uk/investor-relations) .

* The financial terms of the Cash Offer and the Alternative Offer are final
and will not be increased or improved, except that Bidco reserves the right to
increase the amount of the Cash Consideration and improve the financial terms
of the Alternative Offer if there is an announcement on or after the date of
the Rule 2.7 Announcement of an offer or a possible offer for HL by a third
party offeror or potential offeror. Bidco reserves the right to elect to
implement the Acquisition by way of an Offer as an alternative to the Scheme
(with the consent of the Panel (where necessary) and subject to the terms of
the Cooperation Agreement (if applicable)).

Enquiries:

 CVC Private Equity Group                                                     +44 (0) 20 7420 4200

 Carsten Huwendiek

 Nick Board
 Nordic Capital                                                               +46 8 440 5050

 Elin Ljung (of Nordic Capital Advisors)
 Platinum Ivy                                                                 +971 2 415 0000

 Garry Nickson
 Goldman Sachs International (Financial Adviser to Bidco and the Consortium)  +44 (0) 20 7774 1000

 Mark Sorrell

 Nick Harper

 Warren Stables

 Cara Pazdon

 Camila Rodriguez-Bedoya
 FGS Global (PR Adviser to Bidco and the Consortium)                          +44 (0) 20 7251 3801

 Guy Lamming

 Mike Turner

 Anjali Unnikrishnan

Important notices relating to financial adviser

Goldman Sachs International ("Goldman Sachs"), which is authorised by the PRA
and regulated by the FCA and the PRA in the United Kingdom is acting
exclusively for Bidco and the Consortium as financial advisers and no one else
in connection with the Acquisition and other matters set out in this
announcement and will not be responsible to anyone other than Bidco and the
Consortium for providing the protections afforded to clients of Goldman Sachs,
nor for providing advice in connection with the Acquisition, the content of
this announcement or any matter referred to herein. Neither Goldman Sachs nor
any of Goldman Sachs' subsidiaries, affiliates or branches owes or accepts any
duty, liability or responsibility whatsoever (whether direct, indirect,
consequential, whether in contract, in tort, under statute or otherwise) to
any person who is not a client of Goldman Sachs in connection with this
announcement, any statement contained herein or otherwise.

Further information

This announcement is for information purposes only and is not intended to and
does not constitute, or form part of, an offer, invitation or the solicitation
of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise
dispose of any securities, or the solicitation of any vote or approval in any
jurisdiction, pursuant to the Acquisition or otherwise, nor shall there be any
sale, issuance or transfer of securities of HL in any jurisdiction in
contravention of applicable law. The Acquisition is being made solely by means
of the Scheme Document which, together with the Forms of Proxy and the Form of
Election, contain the full terms and conditions of the Acquisition. Any
decision in respect of, or other response in relation to, the Scheme or the
Acquisition should be made only on the basis of the information in the Scheme
Document.

This announcement does not constitute a prospectus or prospectus equivalent
document.

If you are in any doubt as to the contents of this announcement (or any
accompanying documents) or what action you should take, you are recommended to
seek your own personal financial advice immediately from your stockbroker,
bank manager, solicitor, accountant or other independent financial adviser
authorised under the Financial Services and Markets Act 2000, if you are
resident in the United Kingdom, or, if not, from another appropriately
authorised independent financial adviser.

Overseas Shareholders

The release, publication or distribution of this announcement in or into
jurisdictions other than the UK may be restricted by law and therefore any
persons who are subject to the laws of any jurisdiction other than the UK
should inform themselves of, and observe, any applicable legal or regulatory
requirements. Any failure to comply with such requirements may constitute a
violation of the securities laws of any such jurisdiction. To the fullest
extent permitted by applicable law, the companies and persons involved in the
Acquisition disclaim any responsibility or liability for the violation of such
restrictions by any person.

Neither this announcement nor any of the documents referred to herein do or
are intended to constitute or form part of any offer or invitation to
purchase, or otherwise acquire, subscribe for, sell or otherwise dispose of,
any securities or the solicitation of any vote or approval pursuant to the
Scheme or otherwise, in any jurisdiction in which such offer, invitation or
solicitation is unlawful. This announcement has been prepared in accordance
with and for the purpose of complying with English law, the Takeover Code, the
Market Abuse Regulation, the Listing Rules and the Disclosure Guidance and
Transparency Rules and information disclosed may not be the same as that which
would have been prepared in accordance with the laws of jurisdictions outside
England.

The availability of the Acquisition (including the Alternative Offer) to HL
Shareholders who are not resident in and citizens of the UK may be affected by
the laws of the relevant jurisdictions in which they are located or of which
they are citizens. Persons who are not resident in the UK should inform
themselves of, and observe, any applicable legal or regulatory requirements of
their jurisdictions. To the fullest extent permitted by applicable law, the
companies and persons involved in the Acquisition (including the Alternative
Offer) disclaim any responsibility or liability for the violation of such
restrictions by any person.

Unless otherwise determined by Bidco or required by the Takeover Code, and
permitted by applicable law and regulation, the Acquisition (including the
Alternative Offer) will not be made available, in whole or in part, directly
or indirectly, in, into, from, or by the use of mails or any means or
instrumentality (including, but not limited to, facsimile, email or other
electronic transmission, telex or telephone) of interstate or foreign commerce
of, or of any facility of a national, state or other securities exchange of,
any Restricted Jurisdiction where to do so would violate the laws in that
jurisdiction and no person may vote in favour of the Scheme by any such use,
means, instrumentality or from within a Restricted Jurisdiction or any other
jurisdiction if to do so would constitute a violation of the laws of that
jurisdiction. Copies of this announcement and other documentation relating to
the Acquisition (including the Alternative Offer) are not being, and must not
be, directly or indirectly, mailed or otherwise forwarded, distributed or sent
in or into or from any Restricted Jurisdiction and persons receiving such
documents (including, without limitation, agents, custodians, nominees and
trustees) must not mail or otherwise forward, distribute or send them in or
into or from any Restricted Jurisdiction. Doing so may render invalid any
related purported vote in respect of the Acquisition. If the Acquisition is
implemented by way of an Offer (unless otherwise permitted by applicable law
and regulation), the Offer (including the Alternative Offer) may not be made
directly or indirectly, in, into, from, or by the use of mails or any means or
instrumentality (including, but not limited to, facsimile, e-mail or other
electronic transmission, telex or telephone) of interstate or foreign commerce
of, or of any facility of a national, state or other securities exchange of,
any Restricted Jurisdiction and the Offer (including the Alternative Offer)
may not be capable of acceptance by any such use, means, instrumentality or
facilities or from within any Restricted Jurisdiction.

HL Shareholders should be aware that the Acquisition may have tax consequences
and that such consequences, if any, are not described herein. HL Shareholders
are urged to consult with appropriate legal, tax and financial advisers in
connection with the consequences of the Acquisition (including any election
for the Alternative Offer) on them. A summary of the expected tax impact of
the Acquisition for UK shareholders is set out in Part VIII (UK Taxation) of
the Scheme Document.

Further details in relation to Overseas Shareholders are contained in
paragraph 16 of Part II (Explanatory Statement) of the Scheme Document.

Notice to US HL Shareholders

The Acquisition relates to the shares of an English company with shares
admitted to trading on the London Stock Exchange and is being made by means of
a scheme of arrangement provided for under English law. A transaction
implemented by means of a scheme of arrangement is not subject to the tender
offer or proxy solicitation rules under the US Exchange Act. Accordingly, the
Scheme is subject to the disclosure requirements and practices applicable in
the UK to takeover offers and schemes of arrangement which differ from the
disclosure requirements of the US tender offer and proxy solicitation rules.
The financial information included or referred to in the Rule 2.7
Announcement, the Scheme Document and this announcement (as applicable) has
been or will have been prepared in accordance with generally accepted
accounting principles of the UK and thus may not be comparable to financial
information of US companies or companies whose financial statements are
prepared in accordance with generally accepted accounting principles in the
United States.

If, in the future, Bidco exercises its right to implement the Acquisition by
way of an Offer, which is to be made into the US, such Offer will be made in
compliance with applicable US laws and regulations.

It may be difficult for US holders of HL Shares to enforce their rights and
any claim arising out of US federal laws, since Bidco, each member of the
Topco Group and HL are located in non-US jurisdictions, and some or all of
their officers and directors may be residents of non-US jurisdictions. US
holders of HL Shares may not be able to sue a non-US company or its officers
or directors in a non-US court for violations of the US securities laws.
Further, it may be difficult to compel a non-US company and its affiliates to
subject themselves to a US court's judgement.

In accordance with normal UK practice and pursuant to Rule 14e-5(b) of the US
Exchange Act, Bidco, its nominees or its brokers (acting as agents), may from
time to time make certain purchases of, or arrangements to purchase, HL Shares
outside of the US, other than pursuant to the Acquisition, until the date on
which the Acquisition becomes Effective, lapses or is otherwise withdrawn.
Also, in accordance with Rule 14e-5(b) of the US Exchange Act, Goldman Sachs
will continue to act as an exempt principal trader in HL Shares on the London
Stock Exchange. These purchases may occur either in the open market at
prevailing prices or in private transactions at negotiated prices. Any
information about such purchases or arrangements to purchase will be disclosed
as required in the UK, will be reported to a Regulatory Information Service
and will be available on the London Stock Exchange website,
www.londonstockexchange.com.

US HL Shareholders also should be aware that the Acquisition may have tax
consequences in the US and that such consequences, if any, are not described
in this announcement or the Scheme Document. US HL Shareholders are urged to
consult with appropriate legal, tax and financial advisers in connection with
the tax impact of the Acquisition on them.

Forward looking statements

This announcement, statements made regarding the Acquisition, and other
information published by Bidco and HL contain statements which are, or may be
deemed to be, "forward-looking statements". Forward-looking statements are
prospective in nature and are not based on historical facts, but rather on
current expectations and projections of the management of Bidco and HL about
future events, and are therefore subject to risks and uncertainties which
could cause actual results to differ materially from the future results
expressed or implied by the forward-looking statements.

The forward-looking statements contained in this announcement include
statements relating to implementation of the Acquisition and other statements
other than historical facts. Often, but not always, forward-looking statements
can be identified by the use of forward-looking words such as "prepares",
"plans", "expects" or "does not expect", "is expected", "is subject to",
"budget", "projects", "synergy", "strategy", "scheduled", "goal", "estimates",
"forecasts", "cost-saving", "intends", "anticipates" or "does not anticipate",
or "believes", or variations of such words and phrases or statements that
certain actions, events or results "may", "could", "should", "would", "might"
or "will" be taken, occur or be achieved. Forward looking statements may
include (amongst other things) statements relating to the following: (i)
future capital expenditures, expenses, revenues, earnings, synergies, economic
performance, indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the expansion
and growth of Bidco's, HL's, any member of the Topco Group's or any member of
the HL Group's operations and potential synergies resulting from the
Acquisition; and (iii) the effects of global economic conditions and
governmental regulation on Bidco's, HL's, any member of the Topco Group or any
member of the HL Group's business.

Although Bidco believes that the expectations reflected in such
forward-looking statements are reasonable, Bidco can give no assurance that
such expectations will prove to be correct. By their nature, forward-looking
statements involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future. There are a number of
factors that could cause actual results and developments to differ materially
from those expressed or implied by such forward-looking statements.

These factors include, but are not limited to: the ability to complete the
Acquisition; the ability to obtain requisite regulatory approvals and the
satisfaction (or waiver, if capable of waiver) of the remaining  Conditions
on the proposed terms and schedule; changes in the global political, economic,
business and competitive environments and in market and regulatory forces;
changes in future exchange and interest rates; future business combinations or
disposals; changes in general economic and business conditions; changes in the
behaviour of other market participants; changes in the anticipated benefits
from the Acquisition not being realised as a result of changes in general
economic and market conditions in the countries in which Bidco and HL operate,
weak, volatile or illiquid capital and/or credit markets, changes in tax
rates, interest rate and currency value fluctuations, the degree of
competition in the geographic and business areas in which Bidco and HL operate
and changes in laws or in supervisory expectations or requirements. Other
unknown or unpredictable factors could cause actual results to differ
materially from those expected, estimated or projected in the forward-looking
statements. If any one or more of these risks or uncertainties materialises or
if any one or more of the assumptions proves incorrect, actual results may
differ materially from those expected, estimated or projected. Such
forward-looking statements should therefore be construed in the light of such
factors. Neither Bidco nor HL, nor any of their respective associates or
directors, officers or advisers, provides any representation, assurance or
guarantee that the occurrence of the events expressed or implied in any
forward-looking statements in this announcement will actually occur. You are
cautioned not to place any reliance on these forward-looking statements. The
forward-looking statements speak only at the date of this announcement. All
subsequent oral or written forward-looking statements attributable to Bidco or
any member of the Topco Group or the HL Group, or any of their respective
associates, directors, officers, employees or advisers, are expressly
qualified in their entirety by the cautionary statement above.

Other than in accordance with their legal or regulatory obligations, neither
Bidco nor HL is under any obligation, and Bidco and HL expressly disclaim any
intention or obligation, to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.

Dealing and opening position disclosure requirements

Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1 per
cent. or more of any class of relevant securities of an offeree company or of
any securities exchange offeror (being any offeror other than an offeror in
respect of which it has been announced that its offer is, or is likely to be,
solely in cash) must make an Opening Position Disclosure following the
commencement of the offer period and, if later, following the announcement in
which any securities exchange offeror is first identified. An Opening Position
Disclosure must contain details of the person's interests and short positions
in, and rights to subscribe for, any relevant securities of each of (i) the
offeree company and (ii) any securities exchange offeror(s). An Opening
Position Disclosure by a person to whom Rule 8.3(a) of the Takeover Code
applies must be made by no later than 3.30 p.m. (London time) on the 10(th)
business day following the commencement of the offer period and, if
appropriate, by no later than 3.30 p.m. (London time) on the 10(th) business
day following the announcement in which any securities exchange offeror is
first identified. Relevant persons who deal in the relevant securities of the
offeree company or of a securities exchange offeror prior to the deadline for
making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes,
interested in 1 per cent. or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a Dealing
Disclosure if the person deals in any relevant securities of the offeree
company or of any securities exchange offeror. A Dealing Disclosure must
contain details of the dealing concerned and of the person's interests and
short positions in, and rights to subscribe for, any relevant securities of
each of (i) the offeree company and (ii) any securities exchange offeror(s),
save to the extent that these details have previously been disclosed under
Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be
made by no later than 3.30 p.m. (London time) on the business day following
the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by
any offeror and Dealing Disclosures must also be made by the offeree company,
by any offeror and by any persons acting in concert with any of them (see
Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made
can be found in the Disclosure Table on the Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. You should contact the Panel's Market Surveillance Unit on
+44 (0)20 7638 0129 if you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure.

Publication on a website

A copy of this announcement will be made available, subject to certain
restrictions relating to persons in, or resident in, Restricted Jurisdictions,
on HL's website at www.hl.co.uk/investor-relations
(http://www.hl.co.uk/investor-relations) . For the avoidance of doubt, neither
the content of this website nor of any website referred to or accessible from
any hyperlinks set out in this announcement is incorporated by reference or
forms part of this announcement.

Rounding

Certain figures included in this announcement have been subjected to rounding
adjustments.

General

The statements contained in this announcement are made as at the date of this
announcement unless some other time is specified in relation to them, and
service of this announcement shall not give rise to any implication that there
has been no change in the facts set forth in this announcement since such
date. Nothing in this announcement shall be deemed to be a forecast,
projection or estimate of the future financial performance of HL or Bidco
except where otherwise expressly stated.

The Acquisition is subject to English law, the jurisdiction of the courts of
England and Wales, and the applicable requirements of the Companies Act, the
Takeover Code, the Panel, the London Stock Exchange and the FCA.

 

 

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